CONSEQUENCES OF CORRUPTION .
It is as much a moral as a development issue. It can distort entire decision- making processes on investment projects and other commercial transactions, and the very social and political fabric of societies. The following are some of the consequences of corruption:
‘ Economic Development:
Some statistical evidence has now been showing that corruption is associated with (i) public investment; (ii) lower government revenues; (iii) lower expenditures on operations and maintenance; and (iv) resulting lower quality of public infrastructure. The evidence also shows that corruption increases public investment by making it more expensive, while reducing its productivity. The Corruption also acts as an additional tax on investment. In India, current corruption levels mean that the corruption tax on investment is very high. The impact of corruption on the quality of public infrastructure is all too clearly visible in towns and cities of India. The Public Works Department and the State Electricity Boards which are largely responsible for the maintenance of roads and management of power distribution respectively are among the worst corrupt government departments in India. Corruption also reduces the government’s resources and hence its capacity for investment, since tax revenues are depleted by tax evasion. This has two adverse effects: first, shifts away from investments in development areas occur, as bribe-takers are less likely to invest in activities with significant positive social benefits like education and health. Secondly, overall investment levels may fall, since conspicuous consumption or flight of illegal earnings is probably higher than legal earnings. The high potential for capital flight of illegal earnings makes corruption more likely to be associated with a negative impact on the balance of payments.
‘ Political System :
Politically, corruption increases injustice and disregard for rule of law. Basic human rights and freedom comes under threat, as key judicial decisions are based on the extent of corrupt bribes given to court officials rather than on the innocence or guilt of the parties concerned. Police investigations and arrests may be based on political victimisation or personal vendettas rather than on solid legal grounds. Commenting on the socio-political consequences of corruption the Supreme Court of India observed that corruption in a civilised society was a disease like cancer. If not detected in time it was sure to turn the polity malignant leading to ‘disastrous consequences’. The apex court said a sociopolitical system exposed to such a dreaded communicable disease was likely to crumble under its own weight.